Chanel made headlines in March 2018 when it filed a striking lawsuit against a resale company, alleging that it was trying to “deceive consumers into falsely believing [that it] has some kind of … affiliation with Chanel or that Chanel has authenticated [the pre-owned] goods [it was offering up] in order to trade off of Chanel’s brand and goodwill,” all while allegedly offering up infringing products. The defendant in the case, which was filed in the U.S. District Court for the Southern District of New York: The now-30-year-old luxury resale What Goes Around Comes Around, against which Chanel lodged trademark infringement, unfair competition, false advertising, and false association claims.
In response to Chanel’s suit, What Goes Around Comes Around (“WGACA”) – which touts itself as “the leading global purveyor of authentic luxury vintage accessories and apparel” – has argued that it should be shielded from liability on the basis that Chanel’s lawsuit is an impermissible attempt by Chanel to bar the legitimate resale of its products, and that WGACA uses the Chanel trademarks simply to identify its products (which it claims amounts to nominative fair use), and does not claim any affiliation or sponsorship by Chanel.
Reflecting on the significance of the lawsuit (and Chanel’s ongoing case against The RealReal), Foley & Lardner’s Jeffrey Greene and Allison Haugen have stated that the implications “could be broad-reaching, providing guidance to resellers on the parameters of a fair use defense to trademark infringement claims.” They also stand to provide “insights into the validity of antitrust-type claims in instances of claimed interference with the resale market, as well as how resellers ought to describe the authenticity of the goods they sell.”
Given the importance of the case (particularly in light of the rising value of the resale market), we have put together a brief timeline of significant filings (complete with links to any corresponding documentation and/or articles) in order to help you to stay abreast of developments in the case …
Aug. 30, 2024: The parties filed post-bench trial briefs, with Chanel reemphasizing its claim that WGACA misled consumers by falsely implying an affiliation with the French fashion house and that the court should disgorge the reseller’s Chanel-related profits and permanently bar the company from “certifying, guaranteeing, or otherwise making any advertising claims … regarding the genuineness of any Chanel-branded items,” among other things. In its own brief, WGACA claims that Chanel’s demands for profit disgorgement and an injunction are both “unwarranted” and “excessive,” arguing that Chanel has failed to prove that the retailer’s actions led to any actual harm or loss of sales and asserts that it “operates in a distinct market from Chanel, dealing exclusively in pre-owned items, which Chanel, itself, does not sell.”
Jul. 19, 2024: The parties completed their bench trial.
Jul. 15, 2024: The parties began their bench trial before Judge Louis Stanton.
Jul. 12, 2024: Chanel lodged a Phase 2 trial brief with the court, arguing that disgorgement is the appropriate remedy here in light of the jury’s determination that WGACA willfully engaged in willful trademark infringement, false association, unfair competition, and false advertising.
Apr. 19, 2024: The judge set a bench trial date of July 15, 2024 for phase two of the parties’ trial, which will center on Chanel’s bid for equitable remedies, namely, a permanent injunction.
Apr. 8, 2024: WGACA has lodged a brief in opposition to Chanel’s motion for a permanent injunction, arguing that, among other things, Chanel has not been harmed, let alone irreparably harmed, as a result of its activities, and the luxury brand’s proposed injunction is an “overbroad” attempt “clearly intended to terminate WGACA’s ability to sell any Chanel goods.”
Mar. 7, 2024: Chanel is seeking a permanent injunction to block WGACA from continuing to confuse consumers by way of its use of Chanel trademarks, advertising Chanel products that have not been authorized for sale by Chanel and offering up Chanel goods that have been materially altered, among other things.
Feb. 6, 2024: The jury has sided with Chanel on all four of its causes of action (two trademark infringement claims, unfair competition, and false advertising), and awarded $4 million in statutory damages to the luxury brand as a result. (The jury verdict form can be found here.)
The case is Chanel, Inc. v. What Goes Around Comes Around, LLC, et al., 1:18-cv-02253 (SDNY).
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